Martin Shkreli 2.0: Catalyst Pharmaceuticals
Catalyst Pharmaceuticals is pricing firdapse at $375,000 per a year for a drug they did that enables people to move their body
The Background:
Lambert-Eaton myasthenic syndrome (LEMS) is a disorder of the neuromuscular junction-the site where nerve cells meet muscle cells and help activate the muscles. It is caused by a disruption of electrical impulses between these nerve and muscle cells. (Source: NIH)
The disease can render the individual disabled — whether it be getting up, sitting down, lifting arms, and nearly all basic bodily functions are impacted. Often you will find someone with LEMS crawling up stairs, fully wheel chair bound, barely able to lift their arms, and slurred speech.
The original drug (3,4-DAP) was originally invented in Scotland, and the New Jersey-based Jacobus Pharmaceutical Co has been distributing the drug for free through the FDA’s compassionate drug use.
In 2012, Catalyst Pharmaceuticals licensed the Firdapse from Biomarin. BioMarin acquired rights to Firdapse when it purchased Huxley Pharmaceuticals in 2009. (Source: Catalyst Pharmaceuticals Press Release).
In December 2018, Catalyst Pharmaceuticals gained exclusive rights to a modified version of 3,4 DAP. The modified version includes a phosphate, which enables the drug to be shelf-stable; however, negative experiences are being reported due to this change.
The Heartbreak:
LEMS patients are disabled human beings. This drug enables them to move. As per the following tweet from Dr. Vincent Rajkumar, one patient with Medicare Part D has cited the new co-pay cost at $3,800 per month.
Catalyst Pharmaceuticals has used loopholes through the Orphan Drug Act to gain market exclusivity for a drug they did not invent, and setting a price of $375,000 for patients.
The Money
Biomarin: In 2012, BioMarin sold rights to Catalyst Pharmaceuticals to sell firdapse in North America. In return, BioMarin invested $5 million in Catalyst.
In Europe the drug costs ~ 60,000 per a patient per year. BioMarin’s revenue in 2016 was $18 million; and, for the first 9 months of 2017 their revenue was $14.05 million. (Source: Business Insider)
Since 2012, Biomarin has been selling Firdapse for $60,000 per a patient per a year. In 2016, their revenue was $18 million; therefore, they have 300 patients.
Europe has a population of 740M, and Biomarin had 300 patients after selling the drug for four years. The US has a population of 325M, and CPRX is estimating 3,000 patients in the United States. CPRX is misleading the FDA and investors; their numbers do not add up.
The Lawsuits
In 2013, there was a Class Action Lawsuit against Catalyst Pharmaceuticals, which seemingly revolved around false or misleading statements:
In a furious promotional blitz to keep itself alive during the Class Period, Catalyst told investors that it is a company trying to develop a drug for a 3,000 U.S-patient community with “ no effective treatment ” for their disease winning a race to approval against a distant competitor. But the community has less than 1700 members and probably no more than 1000, and the competitor and Catalyst are neck-and-neck because the competitor — Jacobus Pharmaceutical Co., Inc. — had been providing its effective drug, for free, to LEMS patients in the U.S., for twenty years.
What is the Orphan Drug Act?
The intemperate pricing of many orphan drugs is also facilitated by US law that prevents the FDA from considering cost in making decisions about regulatory approval of drugs. What is particularly troublesome to us is a “loophole” in the ODA that allows companies to receive FDA market exclusivity under the ODA for older, existing drugs, such as 3,4‐DAP. It is in this context that 3,4‐DAP has recently undergone randomized, controlled trials pursuant to submission for US FDA approval under the ODA by 2 companies, Jacobus Pharmaceutical Co., Inc. (JPC) and Catalyst Pharmaceuticals, Inc.7, 8
For those not interested in LEMS or CMS, this debate may seem like an issue relevant only for a small number of patients with a rare disease. However, there are approximately 7,000 rare diseases in the US, and rare diseases cumulatively affect 25–30 million individuals in the US.6
~ Dr. Ted Burns (Neurology at the University of Virginia)’s editorial (signed by hundreds of other neurologists)
What are current government inquiries?
Bernie Sanders has sent the following inquiry to Catalyst Pharmaceuticals.
Disclaimer: The above is an attempt to conduct research and analysis on a topic — you need to draw your own conclusions. If you have more up-to-date information or sources or data, please let me know.
